The value of PC real estate

Adobe and Macromedia sweat the assets

The dominant position that Microsoft software occupies on the desktop has long been a major source of competitive advantage to Microsoft. Not only does it ensure that users of Microsoft software are familiar with the look and feel of the Microsoft interface but it also has provided a launch point for their entry into server systems, writes Bloor Research analyst Martin Langham.

Although Microsoft is probably the most prominent occupant of desktop real estate, other software vendors such as Adobe, Macromedia and Real Networks also own important pieces. These vendors have achieved client dominance with the distribution of hundreds of millions of copies of their client software and are now well-placed to leverage their ownership of PC real estate by extending into enterprise-level products.

Adobe has an innovative strategy to exploit its electronic document management capabilities with an Intelligent Document Architecture. It is leveraging client capability to create universally readable and secure documents into a full range of document-centric capabilities for Document Generation, Document Collaboration, Document Control and Security, and Process Management.

Macromedia has entered into this development path more recently. Flash Player is the world's most pervasive software platform, reaching 98 per cent of Internet-enabled desktops worldwide as well as many other popular devices such as mobile phones and PDAs (source: NPD research April 2003). By comparison, Windows Media Player and Real Player have less than 60 per cent market penetration, and QuickTime Player has less than 40 per cent.

Flash Player was initially developed to deliver a rich media experience on Web sites, but it is now evolving. Macromedia Flash enables designers and developers integrate video, text, audio and graphics into effective and engaging user experiences.

Macromedia is able to leverage the power of the Flash Player to deliver one of the best desktop video conferencing experiences available. The ubiquity of the Flash player enables Macromedia to deliver high quality media streams while being economical of bandwidth. This is of key importance in Web conferencing, and Macromedia recently announced Macromedia Breeze to exploit tFlash Player capabilities.

Breeze delivers a range of multimedia services from Webcasts to online video conferencing. Macromedia Breeze can deliver PowerPoint slides with full animation while still allowing the user to control the pace and sequence of the presentation. Anyone who can create a PowerPoint presentation will be able to create and distribute Flash based presentations using Breeze.

As Macromedia and Adobe move into server-based enterprise applications, they face deeply entrenched competition. In Adobe's case, these will be records and forms management companies, including Microsoft. Macromedia, entering the highly competitive Web conferencing market, will also encounter major players such as WebEx and, again, Microsoft with Office Live Meeting.

Both vendors are delivering information worker tools where uptake will be driven as much by user preferences as by the plans of the IT department. The future success of Adobe and Macromedia in successfully delivering enterprise-level solutions will depend on their ability to copy Microsoft in leveraging user experience into effective and comprehensive business solutions.

And of course, users' loyalty is not only important on the desktop; perhaps there are even bigger prizes in the future in interactive TV and mobile phones.

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